Multi-Sector Bond Quarterly Update – January 2025

TwentyFour
Market Update
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It has been a busy year in fixed income markets, with Q4 2024 proving to be a pivotal period marked by significant global events, including the US election. TwentyFour Asset Management’s Eoin Walsh looks at the path for interest rate cuts in 2025.

 


 

Key takeaways

Multi-sector bond market performance 

  • Despite a rate cut from the Fed in December, their stance became more hawkish, signalling a reduced outlook for rate cuts in 2025. This volatility spread into investment grade markets, with US Investment Grade indices falling nearly two percentage points, while UK Investment Grade indices posted a modest positive return.
  • The CLO market performed well, with BBB CLOs returning around 2% and BB CLOs returning 3%.

Market outlook

  • We continue to move up the curve in terms of ratings quality, and remain focused on banks, insurance and asset-backed securities.
  • We remain tactical with our duration positioning, staying neutral to below neutral on Treasuries.

 

 

 

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Fixed Income Market Update Multi-Sector Bonds TwentyFour
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